The Right Way to Set Up a Business for Sustainable Growth
Every business owner wants to grow their company, but it is essential to find ways to create sustainable growth, that is, to ensure that growth doesn’t just happen in fits and starts but is designed for the long-term. Having a plan is important for every aspect of your life, and that is also true with a businesses. Setting realistic goals from the very beginning and expanding gradually is a better way to keep your business growing consistently than grabbing at every opportunity. Whether it is securing financing, hiring, improving efficiency or upgrading, growth that lasts is preferable to gains that will reverse because of lack of planning.
Make sure you have a solid business plan to start out with and update it as needed. Create short-term and long-term objectives that are realistic. You will want to check out the competition and be knowledgeable of what is considered average performance for your industry. Of course, you want your company to exceed average performance and minimal targets, but know what the range is. Not every company can become the giant that Apple is and even Apple had humble beginnings and years of moderate performance before it took off. Aim high, but be satisfied with meeting targets, since that is doing better than 50% of all new businesses that fail.
Hold onto your dreams but don’t ignore the numbers and make sure your accounting is up to date and accurate. It is easy to get carried away and believe that next month will be better when some things clearly are not working. If your accounting is showing that your business is not making enough of a profit, you need to make some decisions to create sustainable growth. This may be delaying an investment, postponing new hires until the end of the year or waiting before opening a new location. The reason many new companies fail is that they try to expand too far too fast and don’t pay attention to the numbers along the way.
Know when to make an investment that is going to be truly additive to growth. Finding affordable software that can dramatically improve productivity is an example of an expense that is likely to create sustainable growth. Also know when it is worthwhile to seek financing or when it is better to wait and try to generate more cash rather than take on debt. Every business is unique, and the strategies may differ according to the type of business you are running.